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Bill Proposes End to Federal Sports Betting Tax

The Most Important Points Summarized

Two U.S. representatives are advocating for the elimination of the federal wagering tax on legal sports betting. The bill, known as the “Discriminatory Gaming Tax Repeal Act of 2025,” aims to remove the 0.25% tax on betting turnover. Critics argue that this tax benefits illegal operators and provides no clear advantage to the government. The bill is currently under discussion in Congress.

Background of the Wagering Tax

The wagering tax was introduced in 1951 to curb illegal gambling. It imposes a 0.25% levy on all legal sports bets in the U.S. However, illegal betting operators do not pay this tax, giving them a financial advantage over licensed providers.

Initiators of the Bill

Representatives Dina Titus (Nevada) and Guy Reschenthaler (Pennsylvania) are leading the initiative to abolish the tax. Both serve as co-chairs of the bipartisan Congressional Gaming Caucus. Titus strongly criticizes the tax, emphasizing that it disadvantages legal operators while benefiting illegal platforms. She also questioned whether the revenue generated from this tax is being used effectively.

Economic Impact

Reschenthaler highlights the significance of the gaming industry for the economy. The industry generates over $70 billion in state and local tax revenues and creates more than one million jobs in the U.S. In Pennsylvania alone, it accounts for approximately 33,000 jobs. He argues that outdated tax regulations burden legal operators and encourage illegal activities.

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Future of the Legislative Initiative

Supporters of the bill believe that eliminating the tax would strengthen the legal gambling industry and reduce illegal betting operations. The bill is currently being discussed in the U.S. Congress. Whether it will be passed remains to be seen.

Our Assessment

Abolishing the federal wagering tax could relieve licensed operators and create fairer competition with illegal platforms. Currently, illegal operators benefit from not having to pay any levies. If the bill is passed, it could enhance the appeal of legal sports betting and stabilize the market in the long run. We will continue to monitor developments.

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